Bill > HB649

This bill creates a three-day sales tax holiday during the first weekend in August each year, during which certain items will be exempt from sales tax. Specifically, the bill provides a tax exemption for clothing (including diapers) priced under $100, school supplies, school art supplies, computers priced under $1,500, school computer supplies priced under $500, and menstrual discharge collection devices. The bill extensively defines these categories, providing detailed lists of what is and is not included. For example, "clothing" includes items like aprons, boots, coats, and uniforms, but excludes items like belt buckles sold separately or sewing equipment. The tax holiday will run from 12:01 a.m. on the first Friday in August to 12 midnight on the following Sunday. The bill includes comprehensive rules for how the tax exemption applies, such as how discounts are calculated, how layaway purchases are handled, and what happens if items are exchanged or returned. The legislation is set to take effect on May 1, 2025, and is part of Kentucky's commitment to the Streamlined Sales and Use Tax Agreement, which aims to simplify sales tax laws across different states.